Market Recap: RISI Crow's Construction Materials Cost Index

Crow's Market Recap -- A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow's Weekly Market Report.

Lumber: Sluggish demand for SPF lumber and eroding order files generated spotty price weakness. Deals in the West were apparent, although major producers tended to hang onto quotes despite having very thin order files. Bearish Southern Pine lumber buyers continued to purchase just enough volume to cover the essentials while no price bottoms were in sight. Varying degrees of aggressiveness on the part of producers generated broad ranges of sales prices. Coastal species lumber producers were forced to discount prices in order to sell the week's production. Deep counters were turned away, but buyers were able to come away with volumes of most dimension items at $10 to $15 below the prior week's levels. Inland lumber species felt the ripples from weaker Coastal and Canadian lumber markets. The price adjustments are viewed as being basically positive among both producers and buyers. Radiata Pine industrials are tight and firmly priced. Increased demand has enabled Ponderosa Pine industrial lumber producers to keep most of their prices very firm or moving up slightly. Mldg&Btr prices remain fixed. All the lower-grade Shop is very firm, with P99 showing some increases. Some seasonal slowness has been reported in the Ponderosa Pine 4/4 board market, especially in the West. That slowness has affected the pricing of Selects in California and #2 Common in the entire region. Eastern White Pine boards are very firm and reasonably active for pre-arranged tallies destined for big box stores. Producers have seen an increase in overall demand, but they are adamant about keeping production levels unchanged. Western Red Cedar mills continued to nudge prices higher where the opportunity presented itself.

Panels: OSB producers have taken long order files, based on that buying activity, and are either holding their prices at very firm levels or testing slightly firmer numbers. Buyers, seeing the volumes of orders they have placed, are now awaiting delivery of those orders and contemplating their next moves. Trading was fluid in the Southern Pine plywood market. Producers were able to keep order files out in front of production, but buyers preferred to purchase only conservative volumes when the need arose. Western Fir plywood prices remained on an upward tilt, shaped by demand continuing to outpace production. Helped by a strong plywood market in Canada, supplies for shipment in June are very thin. Most order files extended into the week of July 9; some beyond that week. The Canadian plywood market is still very firm. Buyers are not desperate for wood, most of them having stayed in line and taken mill price increases as they came. Mills continued to book relatively strong volumes of particleboard and MDF. Particleboard order files kept pace with production, although some buyers have pulled back.